US President Joe Biden is receiving widespread auto industry support for a requirement that half of all new American vehicles produce zero emissions by 2030.
Biden’s executive order, to be signed Thursday afternoon, was viewed as a boon to the fledgling US electric-vehicle (EV) industry, which has struggled to compete with China and Europe. The president also planned to toughen fuel-efficiency standards designed to reduce emissions, moving them back in line with former president Barack Obama’s goals after his successor Donald Trump loosened them.
In conjunction with Biden’s plan, the Detroit 3 – Ford, GM and Stellantis, which makes Jeep and Chrysler vehicles – voiced plans to sell 40% to 50% of US electric-vehicle volumes, including battery electric, fuel cell and plug-in hybrids, by 2030.
Kelly Blue Blook, the US automotive market analytics firm, reported last week that sales of electrified vehicles (pure EV and hybrids) doubled year-over-year in the second quarter of 2021. Electrified vehicles made up 8.5% of total sales in the second quarter.
Warnings on EV charging network
“We look forward to working with the Biden administration, Congress and state and local governments to enact policies that will enable these ambitious objectives,” said Ford, GM and Stellantis in a joint statement supplied by the White House.
But they warned that the goals require full deployment of Biden’s Build Back Better Plan, including “purchase incentives, a comprehensive charging network of sufficient density to support the millions of vehicles these targets represent, investments in (research and development), and incentives to expand the electric-vehicle manufacturing and supply chains in the United States.”
BMW, Honda, Volkswagen and Volvo expressed similar sentiments in separate statements. They noted that automakers following California emission-reduction guidelines aim to have EVs account for 40% to 50% of their sales within the next nine years. They also noted that federal government support is “crucial” to building consumer demand and putting the US on track to meet Paris commitments.
Toyota’s North American CEO, Ted Ogawa, also backed the plan and pledged that the company would do its part.
Union voices support
The United Autoworkers Union also praised the goals.
“We are at a critical time for the auto industry as countries compete to build the vehicles of the future,” said the UAW in the White House release. “We are falling behind China and Europe as manufacturers pour billions into growing their markets and expanding their manufacturing. We need to make investments here in the United States.”
Contending that “investments alone are not enough,” the UAW also praised the Biden government’s plan to require passenger vehicles to average 52 miles per gallon (mpg) by 2026. That is up marginally from Obama’s goal of 51 mpg, which Trump had reduced the target to 44 mpg.
Biden plans to make yet-to-be-announced emission-reduction goals for post-2026 new vehicles even tougher.
“The future of the auto industry is electric – and made in America,” said Biden on Twitter. “Today I'm signing an executive order with a goal to make 50% of new vehicles sold by 2030 zero-emission – and unveiling steps to reverse the previous administration’s short-sighted rollback of vehicle standards.”
White House proclaims ‘net benefits’
A White House statement said the goals will produce $140 bn in unspecified “net benefits” over the life of the program, save about 200 billion gallons of gasoline, and reduce around two billion metric tonnes of carbon pollution, while the average consumer will receive $900 in fuel savings over the life of the vehicle. The goals will also help the US “outcompete” China in EV production and “tackle the climate crisis,” the White House said.